Can Consumers Negotiate Rates with Payday Loan Providers

There are many ways to go about receiving extra money, whether you need it for a business, to get out of debt or to just have a bit of extra spending money. No matter what you’re looking for, these providers help you receive money when you need it most. The more common forms of receiving a loan is through bank and financial institutional loans and family members. However, when times are tough and you either don’t qualify for these loans or you don’t want to wait for the loan, you can opt into a loan from a payday lender. There are some perks and rather major drawbacks to these loans, so it is important to know everything you can about these loans. And from there, you need to know if you can actually negotiate the rates of these loans before you accept the repayment options.

For starters, this form of loan provides essentially the worst interest rate payments available. Often times, you are given just a small amount of time to repay the loans, and this comes at a substantial price. Some times you actually pay more back in interest than you do through the loan. If you have the means of paying back the loan, this might be possible, but generally speaking, it can take a long time to pay back the loan, due to the high interest rate, unless you instantly have the money available. Thankfully, for some, it is possible to negotiate the interest rate.

There are a few options available to you for reducing the overall interest rate of payday loans. For starters, if you can put some sort of money down, this can help. Showing in good faith you have money and are able to repay it back, this helps you receive a better interest rate. If the payday loan provider is able to see you can earn money and are not a flight risk (avoiding to repay the loan at all), you are likely to receive not only more money, but at a lower interest rate. You can try to negotiate to have a better interest rate, and although the success may vary, this does help your odds. The ability to negotiate the cost of interest may depend on who you talk to at the payday loan center. If you discuss the situation with a manager or owner, you have treater chances of reducing the interest rate than when you talk with a general employee. Always ask to talk with the owner/manager, because the standard employees probably don’t have the ability to reduce the interest rate.

Having a better credit score goes far in reducing your overall repayment period and the interest rate you are required to pay back. The lower your interest rate, the better off you are as the payments are reduced. On top of it, this gives you leeway for adjusting the interest rate. Stating you’ll take your business elsewhere if they don’t give you the interest rate at a lower level is a great negotiation tactic, as they don’t want to lose your business.